Spain is facing a remarkable transformation in its labor market, sparking wide-ranging socioeconomic discussions. While the government under Pedro Sánchez is pushing for a simplified regularization of immigrants to meet the demands of the service sector, the traditional image of the Spanish waiter is increasingly fading into the background. This measure, which contrasts with the stricter requirements under José Luis Rodríguez Zapatero in 2006 (when Social Security registration was required), aims to address the labor shortage in certain areas.
The extraordinary regularization by the Sánchez government makes it easier for immigrants to obtain residence permits without having to show prior employment contracts. This will undoubtedly lead to an accelerated influx of foreign workers, especially into the service sector, which often requires less specialization. In parallel, the EU criticizes Spain’s slow transition to an economic model that relies more on industry and technology – a model promoted by Brussels with European funds as a safeguard against future financial crises and pandemics.
Spain Imports Low-Skilled Workers and Exports Graduates
Spain’s current model seems to be fueling a paradox: the country is increasingly importing low-skilled workers, often at uncompetitive wages, which frequently promotes the informal economy and creates precarious and discontinuous employment relationships. At the same time, Spain is exporting highly qualified workers and university graduates whose education was often funded by public money. These academics seek jobs abroad that match their qualifications, as well as better working conditions and higher salaries.
Recent Social Security figures from April show a remarkable development: Spain has for the first time exceeded the three-million mark for foreign employees. More precisely, there are 2,997,307 people, and if stateless or unrecorded persons are added, the number even exceeds three million. This corresponds to 14% of total employment in Spain – or in other words: one in every seven jobs in Spain, at least in the formal economy, is held by a foreign worker. Since 2012, the beginning of official statistics, this number has increased by 75%, corresponding to an increase of almost 1.3 million contributors. In 2012, the proportion was still 10% of the total working population.
The Sanchez Effect: Explosion of Foreign Employment
After a significant decline in foreign employment following the economic crisis from 2008 to 2016, mainly caused by the return of many Latin Americans to their home countries (often funded by the government), an explosion of employment by foreigners began with Pedro Sánchez’s arrival at La Moncloa in 2018. From almost two million in 2018, the number increased by 55% (almost 1.1 million more) to the current three million in less than seven years. This trend led to the proportion of native Spaniards in total employment decreasing from 90% in 2018 to currently 86%. Since the 2022 labor market reform, foreign employment in the formal economy has increased by more than 27% (almost 900,000 more). Official figures for the informal economy are not available, but estimates suggest around one million people.
Nationalities and Occupations: Who Keeps Spain’s Economy Running?
The Role of Non-EU Citizens
The majority of foreign employees in Spain come from non-EU countries. The Spanish economic model, which is heavily based on services, and wage development – initiated by the PP in 2012 and continued by the PSOE, which for the first time speaks of in-work poverty – favor the hiring of foreigners from non-European countries. Around 2.1 million (70%) of these contributors come from countries outside Europe (58% men), mainly from Latin America and North Africa. Only about 900,000 were born in countries within the European economic environment (53% men), of which almost 40% come from Southeast Europe (Romania).
By age, slightly more than one-third of foreign employees are under 35, while the majority (54%) are between 35 and 54 years old, and only 12% are over 54. Most are registered in the general Social Security system as employees (2.1 million, almost 13% of the total 17 million registered). Their presence in the special agricultural system is also noteworthy, where out of 680,000 contributors, over 261,000 are foreigners – 38% of agricultural jobs are held by foreign-born individuals.
A similar situation exists in the domestic workers’ regime: of 349,000 registered individuals, approximately 148,000 are foreigners, also accounting for more than 38% of employees in this sector. In the self-employed system, almost 15% (one in six) are foreigners, totaling nearly half a million, of whom over 62% are self-employed individuals from non-EU countries. In the declining maritime and mining regimes, foreigners account for only 9% and 2% of total employment, respectively.
The Top Jobs for Foreign Workers
Apart from their strong presence in agriculture and domestic care, statistics by economic sector provide a more detailed insight into the labor market. The largest proportion of foreign workers is found in the hospitality sector, where, in addition to temporary contracts, there are many full-time and especially part-time contracts. Of almost 1.9 million waiters in Spain (general regime and self-employed), exactly 521,418 are foreigners. This may imply lower contribution quality but represents a high presence in official employment statistics.
One in four foreign workers in the hospitality sector is found in Catalonia (almost 110,000), followed by Madrid (85,635, 16%), the Valencian Community (71,319, 14%), and Andalusia (58,913, 11%). Overall, 20.3% of foreign workers are employed in a bar or restaurant, which in turn accounts for 28% of total employment in this sector – almost one-third of waiters in Spain are foreigners.
In commerce (especially retail), almost 420,000 foreigners are employed. They represent 16.3% of total foreign employment and almost 13% of total employment in Spain. Here, 106,462 contributors (24% of foreigners) live in Catalonia, 90,470 (21.6%) in Madrid, and 54,893 (13%) in the Valencian Community.
Foreign Workers in Other Sectors
In construction, almost 295,000 foreign-born individuals are employed, accounting for 11.4% of all foreign workers and almost 21% of employment in this sector nationally. Of these, 23% (66,860) are in Madrid and 21% (over 61,000) in Catalonia. In administration, 271,000 foreigners are employed, making up 11% of total foreign employees and 17% of domestic employment.
The manufacturing sector counts 209,000 foreign workers, accounting for 8.1% of foreign employment and almost 10% of the sector across Spain. In transport and storage, 186,000 foreigners are employed (7% of foreigners, 17% of the national sector). Another 132,000 are engaged in other professional activities (5% of foreigners, 10% of employment in Spain). In the healthcare sector, 127,000 foreigners are employed (5% of foreigners, 6% of the national industry). Interestingly, there are over 102,000 foreign employees in the information and communication sector and over 80,000 in education.
